ByMatthew ShaerNovember 22, 2010

Netflix has raised the price on its DVD-by-mail service – and introduced a new stream-online option for American consumers. Beginning this month, the cost of the popular one-DVD-at-a-time Netflix plan will be hiked to $9.99, up from $8.99; the two-DVD-at-a-time plan will now cost $14.99, up from $13.99. The new price points are presumably an effort to keep up with rising postage and shipping costs.

Meanwhile, users can now opt for a $7.99 stream-online subscription, matching a similar program unveiled in Canada earlier this year. In a post published today on the official Netflix blog, Jessie Becker, VP of marketing at the California-based company, said that an increasing amount of consumers seem to prefer the ease and variety of the streaming-video option.

"Netflix members are already watching more TV episodes and movies streamed instantly over the Internet than on DVDs," Becker wrote, "and we expect that trend to continue. Creating the best user experience that we can around watching instantly is how we’re spending the vast majority of our time and resources. Because of this, we are not creating any plans that are focused solely on DVDs by mail."

In a statement released to the press, Netflix CEO Reed Hastings went one step further. “We are now primarily a streaming video company delivering a wide selection of TV shows and films over the Internet,” Hastings said. News of the stream-online option and the raised subscription prices sent Netflix shares soaring, Business Week reported this afternoon.